OptimizeRx Corp. (OTCQB:OPRX), a leading global provider of digital
health messaging for the pharmaceutical industry, reported results
for the second quarter ended June 30, 2018. Quarterly comparisons
are to the same year-ago quarter.
Financial Highlights
- Net revenue increased 78% to a record $5.1 million.
- Gross margin improved from 44.0% to 56.1%.
- Operating expense as a percentage of net revenue reduced from
57% to 51%.
- Net income of $281,000 or $0.02 per diluted share vs. a
loss
- Raised $9 million in private placement
Operational Highlights
- Up-listed to the Nasdaq Capital Market
- Signed new pharmaceutical manufacturer brands for distributing
digital health messaging through OptimizeRx’s expanding network of
EHR channel partners.
- Partnered with Patient Connect to deliver real-time digital
heath messaging at point-of-care across Europe and provide a
broader solution set for global brands.
Financial Summary Net revenue
in the second quarter of 2018 increased 78% to a record $5.1
million versus $2.9 million in the same year-ago quarter. The
increase was primarily due to growth in OptimizeRx’s two core
products of financial and brand messaging, coupled with broader
distribution through the company’s new channel partners. The launch
of new pharmaceutical brands also contributed to the increase.
Gross margin improved to 56.1% in the second
quarter of 2018 from 44.0% in the year-ago quarter. The improvement
was due to favorable product mix and reduced revenue share
cost. The company remains focused on improving margins, and
maintains its gross margin target of at least 55% through the
fourth quarter of 2018.
Operating expenses in the second quarter of 2018
were $2.6 million, up from $1.6 million in the same year-ago
quarter. The increase was primarily due to additional expenses
related to growth initiatives, including expanding the company’s
executive and sales team. However, operating expense as a
percentage of revenue decreased to 51% as compared to 57% in the
same year-ago quarter.
Net income for the second quarter of 2018 was
$281,000 or $0.02 per diluted share, as compared to a net loss of
$362,000 or $(0.04) per share in the year-ago quarter.
Profitability was primarily due to the increase in revenue and
decrease in operating expense as a percentage of revenue. The
company expects to continue to be profitable on a quarterly basis,
although one-time expenses related to growth initiatives may result
in quarterly fluctuations in profitability.
Cash and cash equivalents totaled $12.0 million
at June 30, 2018, as compared to $5.1 million at December 31, 2017.
The increase in cash was due to $9.0 million equity raise completed
in May 2018. The company has continued to operate debt-free and
expects to generate positive cashflow from operations for the
remainder of 2018.
Management Commentary
“In Q2, we realized our seventh consecutive
quarter of revenue growth and achieved profitability through adding
new pharmaceutical brands, growing our digital health messaging
revenue and expanding our distribution channels,” said OptimizeRx
CEO, William Febbo.
“OptimizeRx continued to be the largest network
of its kind, with promotional programs incorporated into more than
50% of the ambulatory market and with more healthcare providers at
'point-of-prescribe' than any other network. This broad market
reach provides us a substantial competitive advantage as we
continue to grow our core products and pharma customer base. We
continue to believe our addressable market is worth well north of
$500 million to a billion once the market fully adopts this
channel.
“Revenue was up 78% from the year-ago quarter
and up 24% sequentially, demonstrating how our low fixed-overhead
model continues to support a highly-scalable financial opportunity.
This was also evident in our expanding margins. In fact, at 56.1%
for the quarter, we surpassed our previously announced gross margin
goal of 55%, and we expect to again exceed this goal in the second
half of the year.
“For the second half of 2018, we will remain
focused on revenue generation from our core products and expanding
our channel and partner networks both domestically and
internationally. We see this driving continued gross margin
improvement as we scale.
“We plan to use a portion of the proceeds from
our recent $9.0 million raise to make additional sales and channel
investments for expanding further into our core ambulatory market
where we continue to demonstrate high ROI for pharma marketing
spend. We also plan to further expand into the hospital market, a
new channel for us that also represents a significant growth
opportunity. In addition, we will increase investment in the
underlying technology that powers our solutions and will invest in
our data strategy.
“While investments in these growth initiatives
may result in quarterly fluctuations in profitability, we expect
them to drive further strong topline growth and margin expansion
while sustaining our position as the market leader in our
space.”
Conference Call
OptimizeRx management will host the
presentation, followed by a question and answer period.
Date: Tuesday, August
7, 2018 |
Time: 4:30 p.m. Eastern
time (1:30 p.m. Pacific time) |
Toll-free dial-in
number: 1-888-220-8451 |
International dial-in
number: 1-323-794-2590 |
Conference ID:
9709267 |
Please call the conference telephone number five
minutes prior to the start time. An operator will register your
name and organization. If you have any difficulty connecting with
the conference call, please contact CMA at 1-949-432-7566.
A replay of the call will be available after
7:30 p.m. Eastern time on the same day through August 28, 2018, as
well as available for replay via the Investors section of the
OptimizeRx website at www.optimizerx.com.
Toll-free replay
number: 1-844-512-2921 |
International replay
number: 1-412-317-6671 |
Replay ID: 9709267 |
About OptimizeRxOptimizeRx®
(NASDAQ:OPRX) is one of the nation’s leading providers of digital
health messaging via electronic health records (EHRs), providing a
direct channel for pharma companies to communicate with healthcare
providers. The company’s cloud-based solution supports patient
adherence to medications by providing real-time access to financial
assistance, prior authorization, education, and critical clinical
information. The company’s network is comprised of leading EHR
platforms like Allscripts, Amazing Charts and Quest, and provides
more than half of the ambulatory patient market with access to
these benefits within their workflow at the point-of-care. For more
information, follow the company on Twitter, LinkedIn or visit
www.optimizerx.com.
Important Cautions Regarding Forward
Looking StatementsThis press release contains
forward-looking statements within the definition of Section 27A of
the Securities Act of 1933, as amended, and such as in section 21E
of the Securities Act of 1934, as amended. These forward-looking
statements should not be used to make an investment decision. The
words 'estimate,' 'possible' and 'seeking' and similar expressions
identify forward-looking statements, which speak only as to the
date the statement was made. The company undertakes no obligation
to publicly update or revise any forward-looking statements,
whether because of new information, future events, or otherwise.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted, or quantified.
Future events and actual results could differ materially from those
set forth in, contemplated by, or underlying the forward-looking
statements. The risks and uncertainties to which forward-looking
statements are subject include, but are not limited to, the effect
of government regulation, competition and other material risks.
OPTIMIZERx
CORPORATION CONDENSED CONSOLIDATED BALANCE
SHEETSAS OF JUNE 30, 2018 AND DECEMBER 31,
2017
|
|
June 30, 2018 (unaudited) |
|
|
December 31, 2017 |
|
ASSETS |
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
12,003,864 |
|
|
$ |
5,122,573 |
|
Accounts
receivable |
|
|
2,954,782 |
|
|
|
2,257,276 |
|
Accounts
receivable – related party |
|
|
2,555,931 |
|
|
|
1,173,614 |
|
Prepaid
expenses |
|
|
215,108 |
|
|
|
255,428 |
|
Total Current
Assets |
|
|
17,729,685 |
|
|
|
8,808,891 |
|
Property and equipment,
net |
|
|
152,898 |
|
|
|
167,305 |
|
Other Assets |
|
|
|
|
|
|
|
|
Patent
rights, net |
|
|
604,820 |
|
|
|
638,766 |
|
Web
development and other intangible costs, net |
|
|
152,381 |
|
|
|
143,730 |
|
Security
deposit |
|
|
5,049 |
|
|
|
5,049 |
|
Total Other Assets |
|
|
762,250 |
|
|
|
787,545 |
|
TOTAL ASSETS |
|
$ |
18,644,833 |
|
|
$ |
9,763,741 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
|
|
|
|
Accounts
payable – trade |
|
$ |
176,940 |
|
|
$ |
457,289 |
|
Accrued
expenses |
|
|
828,540 |
|
|
|
953,947 |
|
Revenue
share payable |
|
|
994,142 |
|
|
|
1,177,136 |
|
Revenue
share payable – related party |
|
|
- |
|
|
|
447,670 |
|
Deferred
revenue |
|
|
845,153 |
|
|
|
507,160 |
|
Total
Liabilities |
|
|
2,844,775 |
|
|
|
3,543,202 |
|
Stockholders’
Equity |
|
|
|
|
|
|
|
|
Preferred
stock, $0.001 par value, 10,000,000 shares authorized, no issued
and outstanding at June 30, 2018 or December 31, 2017 |
|
|
- |
|
|
|
- |
|
Common
stock, $0.001 par value, 166,666,667 shares authorized, 11,556,858
and 9,772,694 shares issued and outstanding at June 30, 2018 and
December 31, 2017, respectively |
|
|
11,557 |
|
|
|
9,773 |
|
Stock warrants |
|
|
1,286,424 |
|
|
|
1,286,424 |
|
Additional
paid-in-capital |
|
|
44,915,896 |
|
|
|
35,287,464 |
|
Accumulated
deficit |
|
|
(30,413,819 |
) |
|
|
(30,363,122 |
) |
Total Stockholders’
Equity |
|
|
15,800,058 |
|
|
|
6,220,539 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
$ |
18,644,833 |
|
|
$ |
9,763,741 |
|
OPTIMIZERx
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED)FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2018 AND 2017
|
|
For the Three Months Ended |
|
|
For the Six Months Ended |
|
|
|
June 30 |
|
|
June 30 |
|
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
NET REVENUE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
3,192,138 |
|
|
$ |
2,252,222 |
|
|
$ |
5,961,257 |
|
|
$ |
3,652,540 |
|
Revenue – Related
Party |
|
|
1,907,336 |
|
|
|
613,601 |
|
|
|
3,250,453 |
|
|
|
1,365,356 |
|
TOTAL NET REVENUE |
|
|
5,099,474 |
|
|
|
2,865,823 |
|
|
|
9,211,710 |
|
|
|
5,017,896 |
|
REVENUE SHARE
EXPENSE |
|
|
2,236,751 |
|
|
|
1,605,534 |
|
|
|
4,244,842 |
|
|
|
2,987,267 |
|
GROSS
MARGIN |
|
|
2,862,723 |
|
|
|
1,260,289 |
|
|
|
4,966,868 |
|
|
|
2,030,629 |
|
OPERATING EXPENSES |
|
|
2,589,126 |
|
|
|
1,630,853 |
|
|
|
4,884,467 |
|
|
|
3,291,631 |
|
INCOME
(LOSS) FROM OPERATIONS |
|
|
273,597 |
|
|
|
(370,564 |
) |
|
|
82,401 |
|
|
|
(1,261,002 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
|
6,912 |
|
|
|
9,063 |
|
|
|
8,929 |
|
|
|
16,819 |
|
Interest
expense |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OTHER INCOME (EXPENSE) |
|
|
6,912 |
|
|
|
9,063 |
|
|
|
8,929 |
|
|
|
16,819 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME (LOSS) BEFORE
PROVISION FOR INCOME TAXES |
|
|
280,509 |
|
|
|
(361,501 |
) |
|
|
91,330 |
|
|
|
(1,244,183 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR INCOME
TAXES |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
NET INCOME (LOSS) |
|
$ |
280,509 |
|
|
$ |
(361,501 |
) |
|
$ |
91,330 |
|
|
$ |
(1,244,183 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERGE NUMBER
OF SHARES OUTSTANDING |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC |
|
|
10,979,086 |
|
|
|
9,861,257 |
|
|
|
10,373,326 |
|
|
|
9,883,648 |
|
DILUTED |
|
|
11,949,593 |
|
|
|
9,861,257 |
|
|
|
11,517,604 |
|
|
|
9,883,648 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) PER
SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC |
|
$ |
0.03 |
|
|
$ |
(0.04 |
) |
|
$ |
0.01 |
|
|
$ |
(0.13 |
) |
DILUTED |
|
$ |
0.02 |
|
|
$ |
(0.04 |
) |
|
$ |
0.01 |
|
|
$ |
(0.13 |
) |
OPTIMIZERx
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED)FOR THE SIX MONTHS ENDED
JUNE 30, 2018 AND 2017
|
|
For the six months Ended June 30 |
|
|
|
2018 |
|
|
2017 |
|
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net
income (loss) for the period |
|
$ |
91,330 |
|
|
$ |
(1,244,183 |
) |
Adjustments to reconcile net income(loss) to net cash used in
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
108,946 |
|
|
|
141,945 |
|
Stock and
options issued for services |
|
|
1,013,822 |
|
|
|
291,874 |
|
Changes in: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
(2,079,823 |
) |
|
|
638,602 |
|
Prepaid
expenses |
|
|
40,320 |
|
|
|
(866,333 |
) |
Accounts
payable |
|
|
(280,349 |
) |
|
|
534,743 |
|
Revenue
share payable |
|
|
(183,664 |
) |
|
|
(751,094 |
) |
Accrued
expenses |
|
|
(125,407 |
) |
|
|
(91,981 |
) |
Deferred
revenue |
|
|
195,966 |
|
|
|
650,331 |
|
NET CASH USED IN
OPERATING ACTIVITIES |
|
|
(1,218,859 |
) |
|
|
(696,096 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Purchase
of property and equipment |
|
|
(12,593 |
) |
|
|
(24,599 |
) |
Web
development and other intangible costs |
|
|
(56,651 |
) |
|
|
(81,350 |
) |
NET CASH USED IN
INVESTING ACTIVITIES |
|
|
(69,244 |
) |
|
|
(105,949 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net
proceeds from issuance of common stock for cash |
|
|
8,169,394 |
|
|
|
- |
|
Repurchase of common stock and stock payable |
|
|
- |
|
|
|
(390,000 |
) |
NET CASH PROVIDED BY
(USED IN) FINANCING ACTIVITIES |
|
|
8,169,394 |
|
|
|
(390,000 |
) |
NET CHANGEIN CASH AND
CASH EQUIVALENTS |
|
|
6,881,291 |
|
|
|
(1,192,045 |
) |
CASH AND CASH
EQUIVALENTS - BEGINNING OF PERIOD |
|
|
5,122,573 |
|
|
|
7,034,647 |
|
CASH AND CASH
EQUIVALENTS - END OF PERIOD |
|
$ |
12,003,864 |
|
|
$ |
5,842,602 |
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid
for interest |
|
$ |
- |
|
|
$ |
- |
|
Cash paid
for income taxes |
|
$ |
- |
|
|
$ |
- |
|
Non-cash
issuance of shares to WPP |
|
$ |
447,000 |
|
|
$ |
- |
|
OptimizeRx Contact:Doug Baker, CFOTel (248)
651-6568 x807dbaker@optimizerx.com
Investor Relations Contact:Ron Both, CMATel
(949) 432-7557Email contact
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